On 1 July 2016 Liala Ltd sold an item of plant to Jordan Ltd for $450000 when its’ carrying value in Liala Ltd book was $600000 (costs $900000, accumulated depreciation $300000). This plant has a remaining useful life of five (5) years form the date of sale. The group measures its property plants and equipment using a costs model. Tax rate is 30 percent. Required: Pass the necessary entries on 30 June 2017 and 30 June 2018 to eliminate the intra-group transfer of equipment.

Q: On 1 July 2019 Manila Ltd sold an item of plant to Tokyo Ltd for $600,000 when its carrying value in…

A: Journal entry is a primary entry that records the financial transactions initially.

Q: On 1 January 2020 a company purchased some plant.   The invoice showed Cost of plant £61,000…

A: Capitalised cost of the asset means all costs related to purchase of asset along with all costs…

Q: On 1 July 2016 Liala Ltd sold an item of plant to Jordan Ltd for $450000 when its' carrying value in…

A: Deferred tax liability: When Income Tax Expense account is less than the Income Tax Payable account,…

Q: Pass the necessary entries on 30 June 2017 and 30 June 2018 to eliminate the intra-group transfer of…

A: Corporate accounting:   Branch of accounting that deals with the preparation of the financial…

Q: Lokton plc has a piece of equipment which it bought on 1 January 2014 for £1,000,000. The equipment…

A: The impairment loss is the loss suffered by the company when the fair value of the asset in lower…

Q: On 1 July 2016 Liala Ltd sold an item of plant to Jordan Ltd for $450000 when its’ carrying value in…

A: The transactions are journalized to eliminate intra-entity transfer of equipment.

Q: Lokton plc has a piece of equipment which it bought on 1 January 2014 for £1,000,000. The equipment…

A: Impairment loss is booked when the market value of the assets is less than the current book value of…

Q: Pass the necessary entries on 30 June 2017 and 30 June 2018 to eliminate the intra-group transfer of…

A: Introduction: Depreciation: A fixed charged on the value of asset that reduces its value is known as…

Consolidation

Consolidation in general examination implies an asset oscillating between well-defined methods of trading status. Consolidation is commonly known as market indecisiveness, which completes when the asset's values move forward or backward the trading structure.